With the European Central Bank's monetary policy announcement behind us, the focus of the forex market will now turn to the non-farm payrolls report. The newly delivered stimulus from the ECB and the better than expected U.S. jobless claims report boosted the attractiveness of the U.S. dollar against all major currencies. Whether or not the sell-off in the EUR/USD and rally in USD/JPY can be sustained will hinge on Friday's non-farm payrolls report. This week's FOMC statement tell us that that Federal Reserve officials aren't overly concerned about the health of the labor market as they completely ignored last month's sharp drop in payrolls, choosing instead to repeat that the labor market is improving.

They better be right or else the dollar and U.S. stocks for that matter will come crashing down. Currently economists are looking for payrolls to rise by 140K in April, up from 88K in March. The drop in jobless claims and consumer confidence supports a stronger release and we believe that as long as payrolls rise by 150K or more, the dollar will rally. By cutting interest rates today and signaling that they are prepared to do more, the ECB has set a low bar for tomorrow's NFP release.https://support.fxcc.com/email/technical/03052013/

Upwards scenario: On the upside potential is seen for a break above the resistance at 1.3084 (R1). In such case we would suggest next target at 1.3120 (R2) and any further rise would then be limited to final resistance at 1.3156 (R3). Downwards scenario: Further correction development is limited now to the session low - 1.3057 (S1). If the price manages to surpass it we would suggest next intraday targets at 1.3037 (S2) and 1.3016 (S3).

Upwards scenario: Possibility of market strengthening is seen above the resistance level at 1.5573 (R1). Clearance here is required to validate next interim target at 1.5598 (R2) and any further rise would then be targeting mark at 1.5629 (R3). Downwards scenario: We would shift our short-term technical outlook to the negative if the price manage to penetrate below the key support at 1.5522 (S1). Loss here would suggest next initial targets at 1.5489 (S2) and 1.5448 (S3).

Upwards scenario: Next actual resistance level is seen at 98.15 (R1). If the market manages to surge higher, our focus would returned to the next target at 98.51 (R2) and further recovery action could be exhausted at 98.85 (R3) intraday. Downwards scenario: Any downside extension is limited now to the next support level at 97.82 (S1). Break here is required to open a route towards to next target at 97.61 (S2) and then any further easing would be targeting final support at 97.42 (S3).